What's Next if HSBC's $9.3 Billion Deal Is Blocked

1/10/2013 12:26AM

The China Insurance Regulatory Commission is expected to block HSBC's sale of its stake in Ping An Insurance over uncertainty about the deal's funding. The WSJ's Ken Brown explains what this would mean for HSBC's stake.

This transcript has been automatically generated and may not be 100% accurate.

I ... the ... one of the biggest acquisition last year involving HSBC ... Thai tycoon Dhanin massive Chinese insurer look like on the verge of collapse ... welcome to Asia Today Ahmadi the Sanchanta ... with me to discuss this is Ken Browne our Asia Financial editor ... can thank so much for joining me now this story is not a great cast the characters that amass the western bank and it looks like this deal is not can happen to nine point three ... billion dollar acquisition that the Thai tycoon is going to make the HSBC stake in Ping on ... what's what's gone wrong ... well so ... it's surprising when this deal was announced that ... a tight does this man this company would come up with nine point three billion dollars a lot of people the skies reach ... the people have nine three three billion dollars ... so what happened was ... on China Development Bank which is this the only bank in China was going to ... not guarantee the loans and fund and fund this deal ... and that's with the deficit problem is right now ... so the big question is what does this mean for HSBC now how are they can offload their stake in the company they were looking in a two point six billion ... from the DL and now was kind of ... investments ... right that's when you see so with that that if the deal doesn't go through so what happened is that ... the regulators are now saying in China is testing record crude steel because the monies are coming through okay so that's ... that if the free just PC writes a baby to big stake Rex lot of money ... before this deal the speculation was that we try to sell at the stock market over time ... that any get this free opportunity now ... has a couple things look was going by the state now that Chinese regulators are giving all this murky you know ... of questioning questioning until ... the second thing is ... they just received a precious sell this thing because ... aam on the new capital rules for banks ... when banks hold a stake into the financial company ... it seats in order is penalty in terms of the capital required to put up against its bid for these banks such as PCs and stock ... interesting of course have been a lot of questions raised about going on in general ... aam about China ... but what is this mean that this deal in general looks like it isn't going to happen was that mean for the inability of the Western banks ... was that mean for the credibility of the Thai tycoon gorgeous Heineken and it's it's a no one no one looks really good in this when you announce a nine billion dollars deal and in ... the car falls apart in a little over a month later just know what no one looks good ... enough it highlights what everyone knows which is deal making in China is murky the government gets involved is politics involved ... citizens to come because it's actually a private company is publicly listed ... such as that of ... what a bigger private companies for such an interesting ... element but then assist Chinese government run bank has policy bank ... traded on the back ... no one looks good ... that I tycoon ... is probably Guinea head back to to to Thailand's in any no continuing to raise chickens like he does but ... it's it's you know it's it's in our story ... thanks so much and our Asia Financial editor ... but the Wall Street Journal ...